Important Changes to New York Property Condition Disclosure – What Every Agent Needs to Know
Effective March 20, 2024, significant changes to New York Property Condition Disclosure Statement, as required under Section 466 of the Real Property Law (RPL), have gone into effect. These updates impact how sellers disclose property conditions, especially regarding flooding, and they directly affect real estate licensees representing buyers and sellers of residential properties.
Key Changes to the PCDS
- Mandatory Flood Disclosure:
The amended PCDS now requires sellers to disclose information related to flooding. This includes whether the property is located in a floodplain, any known flood damage, and whether flood insurance is in place.2. Elimination of $500 Credit Option:
Previously, sellers could choose to forgo providing a completed PCDS by instead offering a $500 credit to the buyer at closing. This option has been eliminated. Sellers are now required to complete the PCDS. Failure to do so may lead to legal complications and non-compliance.3. Mandatory Use of Amended Form:
All residential transactions involving a binding contract of sale on or after March 20, 2024 must utilize the amended PCDS form, regardless of when the listing was taken.
The amended PCDS form is available from the New York State Department of State here:
Click Here for Required PCDS Form
Licensees’ Responsibilities Under the Amended Law
Section 466 of the RPL requires that:
– Listing Agents (Exclusive & Non-Exclusive):
You must timely inform each seller you represent of their obligation to complete the PCDS.
– Buyer’s Agents (or Seller’s Agents Dealing with Unrepresented Buyers):
You must timely inform the buyer of their rights and obligations under the PCDS law—this must occur before the buyer signs a binding contract of sale.
Once these duties are performed, licensees are not liable for the seller’s or buyer’s failure to comply with the law.
Key Takeaways for Licensees
– Review your active listings and ensure compliance with the amended PCDS.
– Immediately begin using the new form for any contracts signed on or after March 20, 2024.
– Document when you provide the PCDS to sellers and buyers to protect yourself from liability.
– Always recommend that sellers consult their attorney regarding the PCDS.